<p>Against the backdrop of increasing macroeconomic uncertainty, Huawei has delivered a report card of &#34;stable growth, profit recovery, and significant improvement in cash flow.&#34;</p>
<p>On Tuesday, Huawei released its 2025 annual report, showing that the company achieved full-year sales revenue of 880.9 billion yuan, a year-on-year increase of 2.2%; operating profit was 96.9 billion yuan, a year-on-year increase of approximately 22%, with the operating profit margin rebounding to 11.0%; net profit was 68 billion yuan, a year-on-year increase of 8.7%.</p>
<p>More noteworthy is the recovery of cash flow. In 2025, operating cash flow reached 127.4 billion yuan, a significant year-on-year increase of 44%, reaching a five-year high.</p>
<p>On the business front, growth momentum is more clearly directed towards AI and automotive: revenue from intelligent automotive solutions reached 45 billion yuan, a year-on-year increase of 72.1%; digital energy revenue was 77.3 billion yuan, a year-on-year increase of 12.7%. In contrast, the two foundational pillars of ICT infrastructure and terminals maintained slight growth; cloud computing revenue of 32.1 billion yuan saw a slight decline, as the company rebalances its &#34;AI black soil&#34; capability building and commercialization pace.</p>
<p>In terms of strategic statements, management defines &#34;artificial intelligence&#34; as one of the most certain strategic opportunities in the next decade, emphasizing strategic focus, an open ecosystem, and &#34;winning through quality.&#34;</p>
<p>In the annual report, Huawei's rotating chairman Meng Wanzhou stated:</p>
<blockquote>
<p>Artificial intelligence may be the last technological revolution in human history, destined to be full of twists and turns, and inevitably magnificent. We firmly believe that this will be the greatest development opportunity and the most certain strategic opportunity in the next decade, or even a longer cycle.</p>
<p>The macroeconomic environment remains severe, and uncertainties are still increasing. Navigating in the fog, the accuracy of the compass is more important than the speed of progress. While seizing certain opportunities, strategic focus is even more crucial. We must maintain strategic determination, proceed steadily, adhere to hardware as the main profit model, restrain the boundaries of development, strengthen core competitiveness, and solidify the &#34;silicon-based black soil.&#34;</p>
</blockquote>
<h2>Core Financials: Moderate Revenue Growth, Profit Margin Recovery, and Soaring Cash Flow</h2>
<p>The annual report disclosed (according to International Financial Reporting Standards - IFRS) that Huawei's profit elasticity in 2025 was stronger than its revenue growth:</p>
<ul>
<li>Sales Revenue: 880.9 billion yuan (+2.2%)</li>
<li>Operating Profit: 96.9 billion yuan (79.4 billion yuan in 2024), with an operating profit margin of 11.0% (9.2% in 2024)</li>
<li>Net Profit: 68 billion yuan (+8.7%)</li>
</ul>
<p>Cash flow improvement was the key indicator change of the year: operating cash flow was 127.4 billion yuan (88.4 billion yuan in 2024). Concurrently, the company's cash and short-term investments were 361.4 billion yuan, a slight decrease from the previous year but still ample; total debt was reduced to 239.3 billion yuan, and the asset-liability ratio was 55.0%, further down from 57.8% in 2024, reflecting the implementation of the operational guideline of &#34;profitable through cash flow&#34; on the financial front.</p>
<h2>Segment Breakdown: Automotive &#34;Explosion,&#34; Energy Acceleration, Cloud Business Under Short-Term Pressure</h2>
<p>From a segment revenue perspective, Huawei's structure in 2025 showed &#34;stable fundamentals, rapid growth in two incremental engines&#34;:</p>
<p><img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/c4df56c0-7d16-420b-85a5-008d2d4a2946.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/c4df56c0-7d16-420b-85a5-008d2d4a2946.png"/></p>
<p>Two structural changes are particularly prominent:</p>
<ol>
<li>
<p>Intelligent automotive solutions have become the fastest-growing segment. As the industry accelerates from &#34;electrification&#34; towards &#34;high-level intelligence,&#34; Huawei has achieved economies of scale through its Kunqun intelligent driving, HarmonyOS cockpit, vehicle control, and intelligent component shipments.</p>
</li>
<li>
<p>Digital energy continues to benefit from definitive trends: decarbonization of power generation, electrification of transportation, and the energy consumption challenges of AI data centers are collectively driving demand, making it a candidate for the &#34;second profit and growth curve.&#34;</p>
</li>
</ol>
<p>Cloud computing revenue saw a slight pullback. However, the company continues to emphasize in its report &#34;using AI to solve industry challenges,&#34; building CloudMatrix AI Infra, token services, and industry intelligent agent platforms, indicating it is still in an investment and structural adjustment phase prioritizing capabilities and ecosystem.</p>
<h2>Regional Structure: Overseas Support for Growth, EMEA and APAC Contribute More Prominently</h2>
<p>From a regional perspective, Huawei's growth in 2025 came more from overseas:</p>
<ul>
<li>China Market: 616.2 billion yuan, +0.2% year-on-year. The fundamental base is stable but growth is limited.</li>
<li>Europe, Middle East, and Africa (EMEA): 161.4 billion yuan, +8.8% year-on-year.</li>
<li>Asia-Pacific: 50.1 billion yuan, +15.7% year-on-year, one of the main high-growth regions.</li>
<li>Americas: 37.2 billion yuan, +2.4% year-on-year.</li>
<li>Others: 16.0 billion yuan, -14.9% year-on-year.</li>
</ul>
<p>This aligns with the annual report's description of the driving factors in each region: EMEA benefits from investments in digitalization, intelligence, and decarbonization; APAC benefits from 5G construction and industry transformation and upgrading; the China market is driven more by AI industry chain opportunities for structural growth, but its overall scale is large and growth is stabilizing.</p>
<h2>AI Foundation: From 5G-A to &#34;Super Node,&#34; Betting on the Certainty of Computing Power and Connectivity Demand</h2>
<p>Huawei divides AI implementation into two &#34;main tracks&#34;: the connectivity industry and the computing industry, emphasizing &#34;embedding AI and security into every product and network.&#34;</p>
<p>On the connectivity side, 5G-A and F5G-A are repeatedly emphasized: by the end of 2025, global 5G-A users exceeded 60 million; Huawei's delivered 5G-A network experience &#34;continues to lead,&#34; and it is driving operators to shift from traffic management to experience management and business innovations such as AI new calls. For the home scenario, global gigabit users exceeded 450 million, with FTTR plans launched by over 50 operators, making the commercialization path for home networks evolving towards ten-gigabit clearer.</p>
<p>On the computing power side, Huawei is heavily betting on the &#34;cluster + super node&#34; system: the Ascend 384 super node has served industries such as internet, finance, telecommunications, and electricity; the Kunpeng processor has launched the TaiShan 950 SuperPoD for general-purpose computing.</p>
<p>Supporting ecosystem metrics are placed in a more core position: by the end of 2025, Kunpeng developers exceeded 3.8 million, Ascend developers exceeded 4 million; openEuler has accumulated over 16 million installations, and openGauss has been downloaded over 5.5 million times, providing data support for a &#34;sustainable ecosystem.&#34;</p>
<h2>Huawei Cloud: From &#34;Model-Centric&#34; to &#34;Agent-Centric,&#34; Commercialization Still Climbing</h2>
<p>The annual report's positioning for Huawei Cloud is very clear: &#34;Intelligent black soil for industries.&#34; The capability building path includes:</p>
<ul>
<li>CloudMatrix AI Infra: Intelligent computing cloud services have been launched, providing a cloud-based massive computing power resource pool; by the end of 2025, over 1,800 global customers were using Huawei Cloud's intelligent computing cloud services.</li>
<li>Token Services and Model Strategy: The self-developed Pangu large model is &#34;fully open-sourced,&#34; while over 160 SOTA models are available for out-of-the-box use, with enhanced fine-tuning and Ascend operator optimization, attempting to differentiate in terms of &#34;cost - effectiveness - engineering.&#34;</li>
<li>Industry Intelligent Agent Enablement Platform: Covering the entire process from development, operation, to maintenance and operation, reporting metrics such as a long-tail task success rate of about 80% and an SLA of 99.95%, with implementations in industries such as finance, coal mining, transportation, manufacturing, and power.</li>
</ul>
<p>However, judging from the financial results, cloud computing revenue has not yet entered an acceleration phase, indicating a time lag between the &#34;platform capability building&#34; of the cloud and the &#34;volume increase in external revenue.&#34; The annual report also disclosed its coverage of 34 geographic regions and 101 availability zones worldwide, implying that ongoing investment costs and the pace of realizing economies of scale will continue to affect the profit performance of the cloud business.</p>
<h2>Terminal and HarmonyOS Ecosystem: Crossing the &#34;Experience Threshold,&#34; Increasing User Lifetime Value Through Ecosystem</h2>
<p>Terminal business revenue in 2025 was 344.5 billion yuan, a year-on-year increase of 1.6%, representing &#34;steady progress.&#34; The annual report attributes the core logic of terminals to enhancing cross-device collaboration experience with a unified HarmonyOS foundation, thereby increasing user stickiness and lifetime value.</p>
<p>Ecosystem metrics are key variables: by the end of 2025, the number of terminal devices equipped with HarmonyOS 5/6 exceeded 36 million; HarmonyOS ecosystem registered developers surpassed 10 million; applications and services available in the app market exceeded 350,000.</p>
<p>For PCs, the release of the first HarmonyOS foldable computer and commercial HarmonyOS office computers is considered a significant milestone in HarmonyOS's &#34;completing the terminal puzzle&#34; (over 15,000 HarmonyOS computer applications).</p>
<p>On terminal hardware, multiple product lines including smartphones, tablets, PCs, and wearables emphasize &#34;premiumization and form factor innovation&#34;; meanwhile, the retail and service network continues to expand: 16 global flagship stores, 480 smart life stores, covering 70 countries and regions, with over 3,100 authorized service centers, serving over 100 million person-times annually, strengthening brand loyalty and high-end user operation capabilities.</p>
<h2>Intelligent Automotive: Avatr Initiates Commercialization Vehicle, Kunqun Intelligent Driving Aims for Highway L3</h2>
<p>Automotive business is the largest growth driver in 2025. The annual report disclosed that in January 2025, Avatr Technology Co., Ltd. began operations. Huawei transferred relevant assets of its intelligent automotive solution business as its strategic vehicle for commercialization in the intelligent automotive field, while continuing to adhere to the positioning of an &#34;incremental component supplier.&#34;</p>
<p>On the product side, Kunqun Intelligent Driving ADS 4 is defined as &#34;the industry's first solution for highway L3 commercial use&#34; and has launched the CAS 4.0 all-dimensional anti-collision system. Scale data continues to accumulate: by the end of 2025, Kunqun Intelligent Driving had provided solutions for over 1.4 million passenger vehicles; it ranks first in market share among luxury vehicles priced over 350,000 yuan in China; vehicles equipped with Kunqun Intelligent Driving have accumulated over 7 billion kilometers of assisted driving mileage and 440 million assisted parking instances.</p>
<p>Meanwhile, Harmony Intelligent Mobility (Avatr), as a &#34;scenario brand&#34; for consumers, continues to expand: 589,100 units were delivered in 2025, a year-on-year increase of 32%, with cumulative deliveries exceeding one million units in 43 months. For Huawei, this is both an extension of its technology brand and a &#34;stress test&#34; for its industry chain synergy and quality system capabilities.</p>
<h2>Digital Energy: Grid-Forming Power Storage, Ultra-Fast Charging, and AI Data Centers, Capturing Three Definitive Curves</h2>
<p>Digital energy business revenue in 2025 was 77.3 billion yuan, a year-on-year increase of 12.7%. The annual report emphasizes that its growth comes from three definitive trends in the new energy industry: decarbonization of power generation, electrification of transportation, and comprehensive intelligence.</p>
<p>On the power generation side, Huawei disclosed that its global inverter shipments in 2025 were approximately 185 GW, and it is promoting the transition of grid-forming energy storage from technical validation to large-scale commercial use; on the transportation side, the &#34;Ultra-Fast Charging Alliance 2.0&#34; has expanded its ecosystem from passenger vehicles to commercial heavy-duty trucks, and is deploying ultra-fast charging networks nationwide and overseas; on the AI infrastructure side, digital energy is bundling &#34;power supply + heat dissipation + energy efficiency&#34; into AI data center solutions. A typical case is the energy efficiency performance of Huawei Cloud's Wuhu Data Center, where the liquid cooling PUE is as low as 1.1 annually.</p>
<p>An implicit highlight of this segment is that as AI computing power demand creates bottlenecks in data center power supply and cooling, digital energy has the opportunity to upgrade from a &#34;new energy equipment supplier&#34; to an &#34;energy infrastructure provider for the AI era.&#34; Its sustainable growth space will depend on project delivery capabilities, quality systems, and ecosystem synergy efficiency.</p>
<h2>R&amp;D Investment and Capital Structure: R&amp;D Intensity Remains &gt;20%, Asset-Liability Ratio Continues to Decline</h2>
<p>Huawei's R&amp;D expenses in 2025 were 192.3 billion yuan, accounting for 21.8% of revenue; cumulative R&amp;D investment over the past decade exceeded 1.382 trillion yuan. The R&amp;D workforce is approximately 114,000, representing 53.7% of the total employee count. In terms of patents, as of the end of 2025, Huawei held approximately 165,000 valid granted patents and had signed over 260 licensing agreements, demonstrating its ability to monetize its &#34;foundational technologies.&#34;</p>
<p>Financially, while cash flow significantly improved, the company continued to deleverage: total debt decreased by about 25.6 billion yuan compared to 2024, and the asset-liability ratio dropped to 55%. Under the directives of &#34;adhering to hardware as the main profit model&#34; and &#34;strategic focus, restrained development boundaries,&#34; this more robust balance sheet management may become Huawei's important fallback for navigating cycles and counteracting external uncertainties.</p>

Huawei's 2025 Revenue and Net Profit See Moderate Growth, Intelligent Vehicle Revenue Surges 72%, Cloud Computing Slightly Declines | Cailian Press